New Directions for a Renewed Profession - PowerPoint PPT Presentation

Loading...

PPT – New Directions for a Renewed Profession PowerPoint presentation | free to download - id: 40920-MWNiM



Loading


The Adobe Flash plugin is needed to view this content

Get the plugin now

View by Category
About This Presentation
Title:

New Directions for a Renewed Profession

Description:

New Directions for a Renewed Profession. Louisiana State University. Fraud & Forensics Conference ... Key: neutral; hard-driving; and factual summaries of ... – PowerPoint PPT presentation

Number of Views:71
Avg rating:3.0/5.0
Slides: 60
Provided by: SPol4
Learn more at: http://www.bus.lsu.edu
Category:

less

Write a Comment
User Comments (0)
Transcript and Presenter's Notes

Title: New Directions for a Renewed Profession


1
New Directions for a Renewed Profession
Barry C. Melancon, CPA AICPA President CEO
  • Louisiana State University
  • Fraud Forensics Conference
  • July 19, 2005

2
Agenda for Today
  • Image
  • America Counts on CPAs
  • CPA Ambassador Program
  • Image Research Results
  • Private Company Financial Reporting
  • Working in the Public Interest
  • Financial Literacy
  • Social Security
  • Tax Reform
  • Advocacy Outreach
  • International
  • PCAOB
  • Others
  • Core Values Quality
  • Anti-Fraud Corporate Responsibility Center
  • Risk Assessment Standards
  • Audit Quality Centers
  • Audit Committee Effectiveness
  • Enhanced Business Reporting
  • XBRL
  • Renewal of the Profession
  • Minority Initiatives
  • Ph. D. Crunch
  • CPA Exam
  • Student Recruitment

3
Building the CPA Image
4
New Positioning for Profession
  • America Counts on CPAs
  • New tagline and marketing resources
  • Underscores the value CPAs bring to communities
    across America
  • Resonates positively with business
    decision-makers, investors and members alike
  • Logo and tagline available from
    www.aicpa.org/cpamarketing

5
More than 500 CPAs Trained Equipped with
Resources
  • Article
  • Pitch letter
  • News release
  • Q A
  • Additional information about the profession
  • Background
  • Key messages
  • Talking points
  • Speech
  • PowerPoint presentation
  • Op-ed piece

Updated to include Social Security Reform
6
Good Work Yielding Good Results
  • Highlights of Recent Research on the CPA Image

7
Research Methodology Investor Sampling
  • Penn, Schoen Berland Associates conducted
    telephone interviews in March 2005
  • 420 General Business Decision Makers
  • 110 C-Suite Executives
  • 506 Investors

8
Goals of 2005 Research
  • Tracking attitudes and opinions since January
    2003
  • Extent to which confidence has been restored in
    the profession
  • New developments in the profession and emerging
    political/public issues
  • Message themes and actions to improve the image
    of the profession

9
CPA Image/Favorability
Are you favorable or unfavorable toward Certified
Public Accountants?
Investors
C-Class
General BDMs
52
47
42
37
38
Very Favorable
10
Profession Favorability
11
CPA Heritage Attributes Improved
Saying Attribute Strongly Applies to CPAs
12
Does Is essential to the success of my business
apply to CPAs?
Saying Attribute Applies - Among General BDMs
13
Bottom Line
  • Profession has come through scandals strongly
  • Resurgence of heritage attributes validates
    America counts on CPAs positioning
  • But
  • Work needed to expand image of CPA as broad
    business and financial advisor
  • Profession needs to take closer look at its role
    in fraud prevention/detection

14
Private Company Financial Reporting
15
Small Business Sector
  • Approximately 24 million small businesses in U.S.
  • Represent 99.7 of all employer firms.
  • Pay 44.3 of total U.S. private payroll.
  • Have generated 60 to 80 of net new jobs annually
    over the last decade.
  • Employ half of all private sector employees.
  • They represent the majority of clients CPAs
    serve.

Sources U.S. Bureau of the Census Bureau of
Labor Statistics, Current Population Survey U.S.
Department of Commerce, International Trade
Administration., according to SBA
16
Private Company Financial Reporting Task Force
  • Determine whether or not
  • General purpose financial statements of private,
    for-profit entities, prepared in accordance with
    generally accepted accounting principles meet the
    needs of all constituents of that reporting.
  • The cost of providing all that is required in
    GAAP financial statements is justified by the
    related benefits to private company constituents.

17
Participating Organizations
  • Preparers
  • Association for Financial Professional
    Financial Executives
  • International Financial Executives
  • Network Group
  • US Chamber of Commerce
  • Practitioners
  • State Societies
  • General
  • FASB
  • Federal Reserve Board
  • Lenders
  • American Bankers AssocAmericas Community
    Bankers AssocCommercial Finance AssocRisk
    Management AssocVarious state banking
    organizations
  • Investors/owners
  • National Federation of
  • Independent BusinessNational Venture Capital
    Assoc
  • Sureties
  • Natl Assoc of Surety Bond ProducersSurety
    Society of America

18
Accomplishing Mission
  • Discussion Paper
  • Focus groups
  • Surveys by independent market researcher
  • Random telephone sampling
  • Broad outreach for any and all
  • Questions same in both survey forms
  • Key neutral hard-driving and factual summaries
    of viewpoints.

19
TF Findings
  • Attributes of GAAP reporting have high value
    according to all constituents (e.g., common
    language, consistency, etc).
  • Too many GAAP-specific requirements lack
    relevance or decision usefulness according to all
    constituents.
  • A majority of each constituent group believe it
    would be useful if underlying accounting in GAAP
    reporting were different, in certain instances,
    for public vs. non-public companies. (One
    exception sureties in broad outreach.)

20
TF Conclusions
  • 1) GAAP for private companies should be developed
    based on concepts and accounting appropriate for
    constituents distinctly different needs
  • 2) TF does not believe that GAAP exceptions and
    other bases of accounting are best response to
    the study findings
  • 3) Fundamental changes should be made in the
    current GAAP standard setting process to meet the
    reporting need of private company constituents.

21
Summary Observations
  • Historical shift in U.S.
  • Research results consistent with what IASB,
    Canadians and others have been hearing
  • No differences for differences sake
  • Private companies would choose which GAAP to
    follow
  • Many details to be addressed but priority 1 must
    be the needs of the key stakeholders

22
Council Resolution, May 2005
  • Directs AICPA management to work with the
    Financial Accounting Foundation (FAF) and the
    Financial Accounting Standards (FASB) in
    identifying and implementing a process for
    evaluating potential changes in recognition,
    measurement and disclosure from GAAP currently
    applied by public companies
  • Recommend a small joint working group to develop
    a detailed proposal to implement fundamental
    change

23
Advocacy Outreach
24
International
  • Actively representing U.S. profession abroad
  • International Public Interest Oversight Board
  • IAASB convergence
  • IASB/FASB convergence
  • Will continue to affect accounting and auditing
    of both public and private companies

25
Advocacy and Outreach
  • PCAOB
  • Coordinating Forum PCAOB/GAO/ASB
  • Independence and Tax Services Comment Letter
  • Permanent observer status on SAG
  • Reports on Elimination of Material Weakness
  • Extension of 404 Compliance dates

26
Advocacy Outreach
  • Meetings with
  • Comptroller General of the US
  • IRS Commissioner
  • Workload Compression
  • E-Filing Extensions
  • SEC Chief Accountant
  • FASB

27
Working in the Public Interest
28
360 Degrees of Financial LiteracyCPAs Making a
Difference
More than 1.6 million hits!
29
Were Building Alliances
  • Natl Endowment for Financial Education
  • Natl Council of Higher Education Loan Programs
  • National Business Educators Association
  • National Council on Economic Education
  • U.S. Treasurys Office of Financial Education
  • American Red Cross
  • Department of Labor
  • GAO
  • FDIC
  • Investor Protection Trust
  • IRS
  • Jumptart
  • Junior Achievement

30
Launching a National PSA Campaign with the Ad
Council
Keep America Beautiful
Friends Dont Let Friends Drive Drunk
Smokey Bear
31
CPA Financial Literacy Resource Center
www.aicpa.org/financialliteracy
Ranks 3 on Google and Yahoo 2 on MSN Search
Engines
32
Social Security Reform
33
Federal Tax Reform
  • Major Presidential initiative
  • We are positioning ourselves as the thought
    leaders and as a resource
  • Purpose of this White Paper is to foster informed
    discussion by providing unbiased facts and
    analysis

34
Core Values Quality
35
Anti-Fraud Corporate Responsibility Resource
Center
  • Established www.aicpa.org/antifraud in 2002
  • Resources based on user perspective i.e.
    auditor, financial manager, educator, student,
    etc.
  • For the auditors
  • Statement on Auditing Standards (SAS) No. 99,
    Consideration of Fraud in a Financial Statement
    Audit
  • requires auditors to review the organizations
    programs and controls to address fraud risks
  • 8 hour CPE Course Fraud and the CPA
  • Competency self-assessment tool for fraud
    prevention

36
Anti-Fraud Corporate Responsibility Resource
Center
  • For financial managers
  • Ethics case studies for financial managers
  • Management Override of Internal Controls The
    Achilles Heal of Fraud Prevention
  • For academia and others
  • Fraud education program for the accounting
    curriculum
  • Institute for Fraud Prevention with UT Austin
    and ACFE

37
(No Transcript)
38
Risk Assessment Suite of Auditing Standards
  • June 15 - Auditing Standards Board issued the
    Risk Assessment exposure draft
  • Eight separate proposed SASs
  • If adopted, would establish standards and provide
    guidance concerning the auditors
  • Assessment of the risks of material misstatement
    in a financial statement audit,
  • Design and performance of tailored audit
    procedures to address assessed risks,
  • Audit risk and materiality,
  • Planning and supervision,
  • Audit evidence

39
Risk Assessment Suite of Auditing Standards
  • Originally exposed on December 2, 2002
  • Significant revisions led ASB to conclud that the
    ED should be re-exposed
  • Would be effective for audits of financial
    statements for periods beginning on or after
    December 15, 2006
  • 60 day exposure period ends August 15, 2005

40
Audit Quality Centers
  • Designed to create a community of professionals
    committed to excellence
  • Shared experiences, best practices and access to
    specialized information and practical tools
  • Reiterates the commitment of our profession to
    provide high quality services that can be
    trusted.
  • A sign of our professions commitment to
    willingly and thoughtfully raise the bar on our
    own expectations.

41
Audit Quality Centers
  • Center for Public Company Audit Firms
  • 889 Member Firms
  • Approximately 96 audits covered
  • Employee Benefits Audit Quality Center
  • 960 Member Firms
  • More than 2/3 audits covered
  • Governmental Audit Quality Center
  • 360 Member Firms

42
(No Transcript)
43
Audit Committee Effectiveness
  • Online Effectiveness Center
  • www.aicpa.org/audcommctr/homepage.htm
  • Roughly 56,000 unique visitors in 2005
  • Audit Committee Toolkits
  • Corporate
  • 40,000 print copies in circulation
  • Tens of thousands of downloads
  • Special tailored editions
  • Not-for-profit
  • Government

44
Audit Committee Toolkits
  • 17 individual tools include
  • Audit Committee Charter Matrix
  • Key considerations of internal control and fraud
  • SECs Financial Expert requirement decision tree
  • Guidelines for executive sessions
  • Guidance for evaluation of
  • internal audit function
  • external auditors, and
  • the audit committee

45
Enhanced Business Reporting
  • Consortium Model with CPA Leadership
  • High quality, more transparent information
  • Helps companies benchmark performance against key
    performance indicators
  • Reduces uncertainty that leads to market
    volatility and higher cost of capital
  • Restores market confidence, with overall benefit
    to health of economy

46
Enhanced Business Reporting
  • Strategic partners to AICPA include
  • Microsoft (charter member of consortium)
  • NASDAQ
  • Business Roundtable
  • Confederation of British Industry
  • International Chamber of Commerce
  • National Association of Corporate Directors
  • National Investor Relations Institute

47
XBRL
  • Started with the idea of one CPA
  • Adoption is accelerating around the world
  • XBRL will do for business reporting what bar
    coding did for product distribution
  • AICPA commitment to audit quality through XBRL
  • XBRL is not just for public companies!
  • The AICPA and the profession are committed to
    XBRL as the enabler to Enhanced Business Reporting

48
Focus on Financial Management
  • New online Financial Management Center to be up
    shortly
  • White paper on why employers should choose CPAs
    as their CFO,COO and CEOs in post Sarbanes-Oxley
    world
  • Stronger relationships with 2 leading
    associations for management accountants CIMA-UK
    and CMA-Canada. Includes
  • Extending international associate status to CMA-C
    members in the U.S., and
  • Publishing 3 new Management Accounting Guides
    developed with CMA-C in the next 6 months.
  • Using content developed by CIMA-UK as a basis for
    CPE programs and online content

49
Renewal of the Profession
50
Working to Bring More Minorities into the
Profession
  • Minority Scholarship Program
  • More than 6M awarded to 1,300 students in the
    last 10 years
  • Significant program changes pending
  • AICPA Student Leadership Workshop
  • 800 participants over last 10 years
  • The Ph.D. Project
  • A partnership of forward thinking corporations
    that creates a pipeline of prepared individuals
    desiring to become accounting professors.
  • In last 10 years the program has doubled the
    number of minority PhDs

51
The PhD Crunch
Total number of accounting doctorates produced by
year
Source AACSB analysis of National Science
Foundation Doctoral Records File
52
The PhD Crunch
  • A few of the solutions being explored with AAA
  • Provide more information to potential students,
    including special web site
  • Financial support to PhD students
  • Reduce the costs to PhD students/programs
  • Encourage groups with vested interest in a viable
    academic accounting profession to fund
    scholarships

53
Volume Task Force Summary
  • 1 reason candidates are not sitting for the
    exam they are too busy
  • Response was consistent across all research
    activities, and mirrors state boards experience
  • In a survey by Maryland State Board for Public
    Accountancy, 26 of the responses cited demands
    of employment for not scheduling exam time,
    followed by family commitments
  • While cost of review courses and exam was raised,
    it was not seen as an obstacle to taking the exam

54
PCPS Efforts to Encourage Firms to Make Time for
Exam
  • PCPS will be working to make sure that firms are
    encouraging their students to sit for the exam
    and not postpone it
  • Managing partners of firms have a great deal of
    leverage here, and PCPS has already started
    communicating that they need to encourage their
    CPA students to sit for the exam as soon as
    possible, despite the daily pressures of client
    work

55
Student Recruitment Signs of Success
Break Through Clutter
  • Over 929,000 students have responded to the
    campaign
  • Approx 60 of SHGP members recall the program
  • Over 255,000 students have registered with
    program
  • Over 175,000 contactable leads

Generate Leads
Create Involvement
Take Action
56
Student Recruitment Signs of Success
  • 42 of high school SHGP members are more likely
    to consider accounting as a result of the SHGP
    program
  • 44 of early college SHGP members are more likely
    to consider accounting as a result of the SHGP
    program
  • 68 of early college SHGP members have taken
    steps to pursue accounting

57
Next GenerationSome promising signs
Enrollment
Graduates
58
Numbers Continue to Move Up
  • More students in early college are declaring
    accounting as their major more high school
    students are planning to declare accounting as
    their major

59
Our Obligation to Tomorrows CPAs
  • Support staff sitting for the Exam
  • Underscore the professions core values
    objectivity, competence and integrity
  • Communicate the importance of professional
    affiliations
  • Instill the professions vision of excellence in
    the next generation
  • Live the vision every day
  • We are the image of the profession.

60
New Directions for a Renewed Profession
Barry C. Melancon, CPA AICPA President CEO
  • Louisiana State University
  • Fraud Forensics Conference
  • July 19, 2005
About PowerShow.com